The fossil fuel and clean energy sectors share a top-line talking point: jobs.
Fossil fuel organizations centered on activities such as fracking and coal mining point to the high-paying jobs for folks with or without an education. Transitioning away from these jobs would hollow out the economies in communities across the United States.
The clean energy sector points to the proliferation of new businesses that will be necessary to decarbonize the U.S. economy, which is expected to create millions of jobs. These activities are more jobs-rich than their dirty energy counterpoints — meaning these organizations often generate more jobs per unit of energy than the fossil fuels sector.
Turns out, both of these narratives are true. Last week, the White House released a report acknowledging the pay gap between dirty and clean energy jobs, and suggested that the federal government needs to protect fossil fuel workers from salary decreases as they shift jobs during the energy transition.
According to data from the Energy Future Initiative, wind and solar workers make on average $5 less an hour than those in the natural gas sector, the highest-paying fossil fuel industry. For a full-time worker, that’s a pay difference of $10,000 annually.
It’s worth noting that renewable energy jobs still pay more than the national median of the entire U.S. economy, which is $19.14. Still, the wage comparison isn’t with the economy at large; it’s with fossil fuel jobs that will go away as we decarbonize the economy.
How clean energy jobs can pay more
Clean energy jobs are often called a "win-win" for workers and the environment. But according to labor groups, wind and solar developers, as well as financing institutions, have deterred unionization among workers, reports Bloomberg. That is keeping wages low, and it’s a phenomenon that is at odds with President Joe Biden’s speech in January when he signed an executive order on climate change and job creation.
"A key plank of our Build Back Better Recovery Plan is building a modern, resilient climate infrastructure and clean energy future that will create millions of good-paying union jobs," Biden said in the address.
There are some bright spots for clean energy unionizing efforts. Offshore wind developer Ørsted, for example, became the first developer to team up with a national union in Denmark last year. But at the current rate of progress in the U.S., clean energy union jobs appear to be a long way off.
Corporate energy buyers could help make inroads. As procurement deals become more common, companies are considering the inclusion of more attributes in the clean energy contracts, including land use considerations, the manufacturing processes behind the technologies and support of local communities.
In "More than a Megawatt," a report from Salesforce that combines suggested practices from nine NGOs, strong labor practices top the list for how to ensure a just energy transition. The report encourages renewable energy buyers to uphold responsible contractor policies, including requiring job quality and union representation.
How to transition fossil-fuel based economies
Disruptive technologies have a long history of creating more jobs than they destroy, freeing up workers to build up new sectors and economies. But if you work in the industry being disrupted, the loss of existing jobs has real impacts.
In particular, the clean energy jobs created often aren’t in the same places that fossil fuel jobs are lost. While coal mining may have been the backbone of a single town, for example, solar installations are scattered across the country. The jobs being created aren’t in the same location as those that are disappearing, and they often don’t require the same skill sets as the ones we’re losing.
This tension is playing out in real-time in California. Last week, California Gov. Gavin Newsom announced a plan for the state to phase out all in-state oil production by 2045.
For people following the scientific imperative to decarbonize energy, that does not sound like an ambitious timeline. Greenpeace wrote in a statement that the phaseout of oil extraction "is not enough to address the urgent climate and public health crises facing Californians."
But to regions dependent on oil and gas jobs, the announcement was personal. Kern County, California, home to almost 80 percent of the state’s active oil wells, depends on oil and gas for about 14 percent of its private-sector economic output. Many workers in the region felt blindsided by the announcement, unsure what it would mean for their livelihoods.
I wasn’t in the room when the governor decided to phase out production, but I have been in many rooms with people from the oil industry who feel personally demonized by the climate movement. While I agree with the science that unequivocally states we need to end fossil fuel extraction to have a chance at a safe climate future, I also don’t want the workers of the industry to shoulder the burden of the transition.
The solution is not to have longer timelines or less aggressive plans. Honestly, most climate plans aren’t ambitious enough. Instead, this is an opportunity for the clean energy industry to set the tone for family-wage jobs that can uplift communities, and focus on training programs and transition recruitment activities. For energy buyers, procuring clean energy alone isn’t enough. As clean energy is poised for growth, make sure you’re supporting organizations that properly value their worker force.